Takeover
L&T’s open offer for Mindtree was launched on June 17 and is set to close on June 28.

In what could be termed India’s first major hostile takeover, engineering and construction major Larsen and Toubro has bought 51.8% of shares in Mindtree, thereby gaining majority control over the Bengaluru-based IT company.

L&T’s open offer for Mindtree was launched on June 17 and is set to close on June 28. On Tuesday, Mindtree's share had reached 48% after Singapore-based Nalanda Capital offloaded its entire 10.6% stake in Mindtree. Amansa Capital too, which held 2.77% stake in Mindtree sold its stake to Mindtree through the open offer.

Under the open offer, 73.9% of public shareholders sold their shares to L&T at Rs 980 a share. According to a Mint report, National Stock Exchange data showed that 3,79,65,103 shares had been tendered as of 12.30pm on Wednesday. L&T had made an open offer to buy shares of Mindtree at Rs 980 a share.

Further, Mindtree’s board also agreed last week to appoint L&T CEO SN Subrahmanyan, CFO  RS Raman, and senior VP of L&T’s defence business Jayant Damodar Patil to the company’s board.

L&T first began the process of acquiring Mindtree in March when it bought 20.32% stake in Mindtree from VG Siddhartha, founder of Café Coffee Day and two of his companies.

Over the next two months, it bought 8.58% stake from other shareholders, which further increased its ownership to 28.9%, after which the open offer started.

In March, Mindtree’s co-founders Rostow Ravanan, Subroto Bagchi and Krishnakumar Natarajan strongly opposed the hostile takeover, saying that it made no strategic sense. Together, they own 13.32% in the company.

Now that L&T has gained majority control of the company, CNBC-TV18 reports that Mindtree founders have decided to sell their stake and exit the company, which would be the end of their fight against the E&C major.

According to the report, some founders may sell their stake in the open offer, while some may stay on for some time and sell their stake over a period of time.

According to Mint, L&T can buy another 15% of shares as it plans to spend Rs 10,800 crore to own 66% in Mindtree.

Also read: L&T's hostile takeover bid of Mindtree, explained